Short-term liquidity in S.Korea hit new record high of $1 tr as of end-2017

Short-term liquidity in S.Korea hit new record high of $1 tr as of end-2017

Liquidity parked in short-term assets until new investment chances arise hit new historic highs in South Korea, but the growth pace slowed amid heated stock, real estate, and cryptocurrency trade.

According to data released by the Bank of Korea on Sunday, liquidity in short-term security and callable assets reached 1,072.4 trillion won ($998 billion) as of the end of 2017. Cash amounted to 96.8 trillion won, demand deposits 227.7 trillion won, money market deposit accounts 525 trillion won, money market funds (MMFs) 48.9 trillion won, certificate of deposit (CD) 24.3 trillion won, cash management accounts (CMA) 50.3 trillion won and repurchase agreements (RP) 5.9 trillion won. The figure refers to money in a security of less than a year that can be cashed out upon demand.

Short-term deposits and investment surged amid prolonged low-interest environment and market uncertainties. Such funds more than doubled last year when compared to 503.65 trillion won in 2007. After surging from 795 trillion won in 2014 to 931 trillion won in 2015 and 1,001 trillion won in 2016, the grow pace in short liquidity eased last year due to bigger investment opportunities in the stock, real estate, and virtual currency markets.